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ASX: XAM - Xanadu Mines

Updated: Apr 23

Xanadu Mines: A copper-gold resource of biblical scale!

Xanadu Mines Executive Chairman Colin Moorhead on 3AW, 2GB, 4BC & 6PR Bulls N' Bears Report

Listen to ASX-listed Xanadu Mines Executive Chairman Colin Moorhead talk to Matt Birney on the Bulls N’ Bears Report about Xanadu’s huge copper-gold resource in Mongolia that would be held up on a pedestal if it was in Western Australia.


Xanadu Mines is an exploration company targeting porphyry copper-gold deposits in Mongolia. Its Kharmagtai project has a mineral resource estimate identified at a massive 1.1 billion tonnes for three million tonnes of contained copper and eight million ounces of gold. The company is also exploring its wholly-owned Red Mountain project in Mongolia.


Matt Birney - Welcome to Bulls N' Bears brought to you today by copper-gold explorer Xanadu Mines.

Matt Birney - ASX code: XAM.

Matt Birney - I'm Matt Birney and I'm joined now by the Executive Chairman of Xanadu Mines, Colin Moorhead.

Matt Birney - Hi Col.

Colin Moorhead - G'day Matt, thanks for having me.

Matt Birney - Okay so Xanadu Mines is an exploration company targeting porphyry copper-gold deposits in the mineral-rich jurisdiction of Mongolia.

Matt Birney - It's 76 and a half per cent owned Kharmagtai copper-gold project has an almost biblical scale resource and the company has the backing of a Chinese outfit that appears to have pretty deep pockets. 

Matt Birney - Xanadu recently kicked off a serious in-field drilling campaign at the project to upgrade the quality of the resource and support its pre-feasibility study.

Matt Birney - All right so Col, it's pretty hard to work out if Kharmagtai's more of a copper or gold project because you appear to have a pretty serious inventory of both. What's the resource there now?

Colin Moorhead - It's a yellow ridge porphyry copper Matt, it's eight million ounces of gold and three million tonnes of copper so far.

Matt Birney - And how many meters will you put down in this latest campaign and what are you hoping to achieve from it?

Colin Moorhead - Tying to achieve two things: thirty thousand meters of drilling, five rigs. 4 doing infield drilling to support the PFS, get everything up to indicated and one rig exploring down dip and near surface targets.

Matt Birney - Now Chinese firm Xinjiang Mining Group has just more than doubled its investment in Xanadu, it now holds a bit under 20 per cent of the company. How much did Xinjiang Mining put in recently?

Colin Moorhead - Recently they put 7.2 million Aussie into the company at the top and they've also put 35 million US into the project, to obtain 50 per cent of our share of the project. That fully funds the PFS so we're fully funded, no need to raise capital at this stage.

Matt Birney - Okay so you've done a scoping study in Kharmagtai, let's just rapid-fire go through some of those metrics. What's the expected CapEx to build that project and expected payback?

Colin Moorhead - Current CapEx is estimated to be about 690 US million with a payback of four years, assuming a four-dollar-per-pound copper price.

Matt Birney - And what's the expected mine life and how much copper-gold do you expect to churn out in a year?

Colin Moorhead - It's currently a 30-year open pit operation, knocking out in the order of 50,000 tonnes of copper and 100,000 ounces of gold per ounce.

Matt Birney - Now you said copper's selling for about $4 U.S. a pound right now, what do you think you'll be able to produce a pound of copper for after gold credits?

Colin Moorhead - Okay over the life of mine it's $1.87 US in our scoping study. It's cheaper upfront $1.02 in the first five years and getting to towards $2 in the rest of the mine life.

Matt Birney - And what about the net present value of the project? Have you wrapped an NPV around it and how much money is it expected to make on year or year on year on average over that 30-year mine life?

Colin Moorhead - So the scoping study is based on four dollars a pound copper and eight per cent discount rate yields are after-tax NPV of $630 million US dollars.

Colin Moorhead - It's got a life of mine EBITDA of over nearly seven billion and it'll do 220 million plus per annum EBITDA.

Matt Birney - Colin Moorhead from Xanadu Mines.

Matt Birney - Thanks for joining me on Bulls N' Bears and remember we're only here to give you information not advice which you should of course seek independently.

Matt Birney - I'm Matt Birney and this is Bulls N' Bears

Outro - For more public company interviews go to the money page on the 6PR, 2GB, 3AW and 4BC websites and click the public companies tab

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